Small DNA tumor viruses, like SV40, provide an excellent model system to study regulation of eucaryotic transcription. We have been interested in the role of RNA splicing in the biogenesis of SV40 mRNA processing. Mapping studies indicate that the spliced cytoplasmic viral mRNAs are derived from the colinear nuclear transcripts which contain intervening sequences (IVS). If the IVS have acquired some essential functions, deletion should lead to a defect of this function. Thus, in an attempt to determine the function of the IVS we have generated a deletion mutant lacking precisely the IVS of 16S mRNA. Although this mutant contains the entire informaion of VP-1, it was unable to synthesize any stable 16S mRNA and consequently no VP-1. The nature of this failure is presumable due to a defect in the post-transcriptional processing of the viral RNA. This presumption is supported by studies with another set of deletion mutants located at or near the splice junction which decrease the frequency with which the splicing event occurs. These results indicate that splicing is an essential function in the biogenesis of SV40 mRNAs.